The Federal Trade Commission announced a settlement with CarShield following accusations of using deceptive advertising tactics to sell vehicle service contracts.
The FTC stated that consumers purchasing service contracts were misled about coverage for certain repairs, which turned out to be false. The agency highlighted false statements made by celebrity and consumer endorsers in CarShield’s advertising, including personalities like Chris Berman and Ice-T.
Samuel Levine, director of the FTC’s Bureau of Consumer Protection, emphasized the importance of holding advertisers accountable for exploiting consumers’ financial concerns with misleading claims.
RELATED STORY | FTC is studying surveillance pricing and which companies use the practice
The FTC also pointed out that CarShield’s celebrity endorsers falsely claimed to be customers of the company when they were not, and misrepresented the savings consumers could expect from the service.
CarShield offers various plans on their website to cover car repair costs for mechanical parts. Despite having an A+ rating from the Better Business Bureau, customer ratings stand at 1.6 out of 5.
Scripps News reached out to CarShield for their response.
